Wednesday, August 27, 2014

Shell on the verge of selling Nigeria oil fields for $5bn

European oil major Royal Dutch Shell is moving ahead with plans to sell a number of its Nigerian oilfields as it ploughs ahead with planned asset sales.

The Anglo-Dutch firm is leading a consortium that is close to selling a cluster of oilfields that include the Nembe Creek Trunk Line, for around $5bn (£3bn, €3.8bn,) according to the Financial Times newspaper.

The move is the latest attempt by a western oil company to pull out from the restive Delta region and the Nigerian market amid recurring incidents of infrastructure sabotage that have caused billions of dollars' worth of damage.

A deal is expected to be finalised in the next few weeks and the total figure for the sale could still change.

Shell "has signed sales and purchase agreements for some of the oil mining leases but not all that we are seeking to divest", Shell said in a statement. "The assets under consideration are OMLs 18, 24, 25, 29 and the Nembe Creek Trunk Line, but the process has not yet concluded."

Shell has already sold off around $8bn worth of assets this year after it announced plans to sell around $15bn worth of assets through 2015.

Indigenous oil companies have expanded in Nigeria in recent years, capitalising on a government plan to boost domestic control over the oil industry.

Shell has faced long-running criticism from human rights groups over its oil production operations in Nigeria.

The company had not taken effective measures to restore the damaged environment in the Niger Delta after oil production caused contamination of the water there, Amnesty International reported in August.